Technicolor (TCH) announced on June 11 that its board has decided not to approve the revised proposal from J.P. Morgan (JPM) and, instead, continues to recommend the transaction entered into between Technicolor and J.P. Morgan on May 2. J.P. Morgan feels that its revised proposal represents a superior economic offer for Technicolor and its shareholders. The revised proposal raises the price per share in the capital increase reserved for J.P. Morgan by 19% from Euros 1.60 to Euros 1.90. This results in additional proceeds of Euros 22 million and an average price per share of between Euros 1.81 and 1.83. J.P. Morgan is therefore disappointed with the decision of the board of Technicolor, which means that the amended resolutions included in its proposal will not be submitted to the forthcoming General Shareholders' Meeting. J.P. Morgan remains entirely prepared to make an investment in Technicolor on the basis of the superior financial terms in its revised proposal. JP Morgan notes that the break-up fee of Euros 3.4 million that J.P. Morgan proposed, representing 2% of the maximum transaction value, would not be triggered by a successful completion of the transaction set out in the offer made by Vector Capital to Technicolor on 25 May. If the resolutions of Vector Capital in such offer are approved by the shareholders of Technicolor, no break-up fee would be payable.
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